Oil & Gas – Well Maintenance

Based in Calgary, Alberta, this client operates in five core areas throughout the Western Canadian Sedimentary Basin. The project was conducted with the largest conventional oil and natural gas producing income trust in North America with an average daily production of approximately 200,000 barrels of oil equivalent (BOE) per day plus probable reserves of approximately 729 million BOE.

Our client had well servicing costs in current production fields which were rising per unit of output with the majority of these costs arising from work conducted by third party contractors (drilling companies). Our client’s goal was to reduce these costs without negatively affecting production but required formalized processes and systems to manage and control these costs.

Develop a problem resolution mechanism to engage our client and their contractor’s personnel to identify and correct problems with a focus on permanent solutions

Assessment Findings

Expectations were not set during the Rig Technician’s tours and action plans to improve performance were not established

An overall lack of understanding of the roles and responsibilities by the Rig Technicians

Management tools to plan, assign work and identify / resolve variances were not utilized effectively

Performance was not evaluated by sectors on a weekly basis

There was no daily follow-up on departmental performance

Inadequate lease set up prior to rig moves and well work overs and a lack of planning and scheduling of the well work overs

Overcharges from third party services

No daily operating report to measure efficiency and down time for all well work overs

PVA's Response

Developed roles and responsibilities for client personnel involved with well servicing management

Increased infield visits by the Rig Technicians

Developed focused communication structures between the Rig Technician and the Rig Consultant related to timely expectations, progress reviews, and issues identification and resolution

Developed Management Operating Systems (MOS) to calculate the “pay-back” of well servicing work

Enhanced the coordination between Client personnel and the contractor’s Rig Crews

Established expectations for Rig Crews on lease

Established Rig Technicians follow-up requirements with consultants, contractors, and other third party services to ensure appropriate action plans were executed and compliance to industry regulations on lease sites were met

The Results

Some significant results obtained by our Client included:

Rig Technicians prioritizing well jobs to provide the greatest added-value

By reducing the time to complete a well work over, wells were fired up and put back in production sooner resulting in increased volume

Increased accountability of the Rig Technicians and ultimately of the actual Rig Crews

Improved well work over performance

Reductions in rig servicing expenses in total and by individual well

Reduction of third party contractor costs

Well Work Over (In Hours)

Savings

Improvement in Supervisory Activities

Long Term Work Continuation

A Client Coordinator was trained and certified during the PVA engagement

A quarterly audit program of the new Management Operating System was developed for the Coordinator

PVA conducted audits over 18 months to ensure compliance to the continued utilization of the Management Operating Systems

These Audits resulted in recommendations and action plans to further identify additional opportunities for improving operations